The lure of running your own business is so strong: do the stuff you love doing, with people you like working with, working as much or as little as you like and spending more time with family, friends and the other things that are important to you.
It’s no news of course that building a business is a really hard thing to do. Despite the promises of running your own business, most of us know that those benefits only come after long, hard work – and for some entrepreneurs, not at all.
The success of your business – and the degree to which you reach your goals – is dependent on many factors. Even before you start building a business there are factors that will determine how much of an uphill climb this is going to be.
Here then are the 11 factors that I’ve seen make a huge difference in how successful you’re likely to be – even before you start out. Some of these are your usual suspects, others are not so obvious. Read on to see how ready you are to build a business.
PS: At the end of this article is a link to the Business Readiness Workbook with more detailed explanations and a worksheet you can use to rate your readiness.
1. I’m business savvy
To build a successful business, you will have to learn many of the skills any business owner has to have, including managing your finances, doing marketing and sales, working with accountants and dealing with payroll and taxes.
Very few of us have all of these skills, and many business owners learn them as they need to. You don’t have to be expert at everything either, but it helps to know enough to tell if someone else is doing a good job for you.
The best way to learn about everything you need to know about is of course building a business. If you’ve built a business before, you can probably rate yourself high. If you’ve been part of a team that built a business, you can rate yourself high as well.
If you have no idea of what’s involved—don’t despair. This doesn’t mean you can’t or shouldn’t run a business; it just means you have a lot to learn.
2. I have the full support of my family
Building a business can be an all-consuming thing and your family (especially if they depend on you) is going to play a large role in giving you the moral and even financial support you need to succeed.
If you don’t have the support of your family, you will have to battle not only the ups and downs of building a business, but also the drag your family is going to place on you. If they don’t support you, you will constantly have to reassure them that things are going to be all right, that this is the right thing to do and the risk is worth taking.
It’s much (like in a whole lot) easier to build a business with the support of your family. If you have their support, rate yourself high. If they’re against the idea, rate yourself low. If you’re single and no one depends on your making a success of this, rate yourself high.
Do you have the support of your family?
3. I have a support network
Building a business can be a lonely thing, and a support network can make all the difference between success and struggle. There are many kinds of support you can use, from peers in the same position as you are to mentors, advisors and professional support groups.
I don’t spend time with each part of my support network every week or month; some I only attend, some I’m actively involved in. But this network allows me to reach out, ask questions, get recommendations and point me at good resources. And when I’m feeling down, I have a shoulder to cry on and someone to give me a pep talk. Or some tough love.
You’re going to need help even if it’s only someone to give you some tough love.
4. I have runway
In the startup world, runway is the amount of time you have before your money runs out and you have to go and find a “real” job (that’s what my mother calls it). You may not be a startup, but you still need runway.
Building a business requires time and money. You can get away with a lot less than you think, but still, you’re going to have to pay for some things. For example, the quickest and easiest way to build a website is using a website builder like SquareSpace or Wix. Some of these services are free, or free for a time, but eventually you will have to pay something.
I recommend you have at least 6 months runway and ideally 12 or more.
5. I’m really good at something
To build a successful business you have to do something for other people they can’t, won’t or don’t like doing themselves. And to do that, you have to be good at that thing.
The good news is that we’re all good at something. And we don’t have to be world-class experts; we just have to be good at it.
There are two parts to this:
- First, you have to recognise that you’re good at something. It can be building websites, or keeping books, or walking dogs. This part is relatively easy.
- The second part is more difficult—you have to turn that expertise into something other people want, and will pay for.
When you’re thinking about building a your own business, you just have to recognise that you’re really good at something. Chances are you will be able to build a business around it—and that’s a bridge you can cross later.
Are you really good at something?
6. I’m passionate about it
My passion is helping entrepreneurs build successful businesses faster.
That passion drives me to get out of bed every morning and work on it. The passion drives me even when the mountain of work ahead of me seems overwhelming. Passion keeps me going even when times are tough.
If you’re not passionate about what you’re doing, you’re going to struggle to get out of bed and work at it every day. You’re going to give up more easily, and you won’t be able to focus the way you need to. When times are tough it’s going to be easier to throw in the towel. You’re not going to provide the level or quality of service or product that underpins a successful business, and you will eventually lose the will to persevere.
Are you passionate about what you do?
7. I’m willing to learn
When you start out building a business—especially the first time—you’re going to have to learn to do stuff you don’t know how to do now. You’re going to have to learn how to market, and to sell, and how to keep your accounting up to date.
The good news is that all of these things are skills you can learn.
But to do that, you have to be willing to learn. For example, everyone is afraid of selling. Selling is difficult and most people (including me) don’t like rejection. And people will say “no” more times than they say “yes”. You’re going to have to learn the skill of selling and you’re going to have to learn how to deal with rejection.
There’s more good news, though.
Nothing is as scary as it first seems after you’ve learnt how to do it. Once you’ve learnt how to sell, it won’t be as scary as it first seemed. And you don’t have to do sleazy or pushy selling—I hate that kind of sales so I don’t do it. I sell by providing value without being asked for it, and let people decide for themselves if they want to invest in my products or services.
The point is that you must be willing to learn how to do stuff. Even if you can’t do it at all and even if you don’t like it now.
Are you willing to learn?
8. I am resilient
You already know that building a business is tough, so I’m not going to bang that drum again. But to get through the tough times you have to be resilient.
Resilience is all about getting up after you’ve been knocked down. It’s also about being able to focus on what you need to do even when there are worries in the back of your mind. And it’s about not giving up the first, second or even third time you have a setback.
Resilience doesn’t mean you have to be a super-star athlete. You just have to have the sheer stubborn willpower to keep going. Ray Croc, the founder of McDonalds, paid his dues as a salesman for 34 years before he met Dick and Mac McDonald. He was 62 years old when he gambled his life’s savings—and eventually achieved his dream.
You don’t have to take as long as Ray or gamble your life’s savings, but you do have to be resilient. You must have the ability to get up when you’ve been knocked down and keep working even when times are tough. Is this you?
How resilient are you?
9. I make stuff happen
One of the great things about having a job is that you’re only responsible for a part of what happens in the business. Mostly, you’re OK when the stuff you’re responsible for gets done, and you make sure it does.
But when you’re the business owner (and often the only employee), you have to make everything happen. The buck stops (and starts) with you—quite literally. There’s no one else to blame, you can’t point a finger or walk away from it. It’s your responsibility and you have to make it happen. All of it.
This is where I see many entrepreneurs struggle. You’re already making something happen by downloading and now working through this workbook. If this is just because you’re curious, that’s fine. But if you want to build a business you’re going to have to make the next step happen, and the one after that, and then the one after that as well.
Because if you don’t, no one else will.
Do you make stuff happen?
10. I take care of my personal finances
I sometimes think the only people that take really good care of their personal finances are financial experts. But that is of course not true—we all take care of our personal finances to some degree.
But how you take care of your personal finances is a good indicator of how good you’re going to take care of your business finances.
If you’re continuously spending money you don’t have, chances are that’s going to show up in your business as well. If you’re habitually late making payments, chances are you’re going to be late in your business as well. If you never know how much money you have in the bank—and what your commitments are—that’s going to show up in your business too.
Being on top of your business finances can make all the difference between success and failure. How well you take care of your personal finances is an indication of how well you’ll do in your business.
So take a close look at how well you manage your personal finances. It doesn’t have to be sophisticated or complicated—just enough to know where you are and what you need. If you’re OK at it, chances are you will be OK with managing your business finances as well.
How well do you take care of your personal finances?
11. I am willing to take a calculated risk
Starting a business is a risky affair. You can load the odds in your favour, you can work as hard as you can and you can invest in the best advice in the world—but there is still a risk.
If you’re not willing to take a risk—a calculated one—building your own business is probably not a good choice for you. You don’t have to be a gunslinger or a gambler; you can take it slow and be cautious and risk as little as possible every step of the way.
Your risk is proportional to what you could lose.
If you’re risking your life’s savings, your risk is very high. If you’re building a business part-time while working at a full-time job, your risk is relatively low. You can (and should) minimise your risk so that if you fail you don’t lose a lot. But recognise that there will always be a risk.
Are you willing to take a calculated risk?
Get the Business Readiness Workbook
So there you have it – the 11 factors I’ve found make a big difference in how successful your business is going to be. To find out more, and see which surprising factors don’t make all that much of a difference, get the Business Readiness Workbook.
The Business Readiness Workbook is an expanded version of this article with additional information and a rating worksheet. Get immediate access by filling in the form below.